Vivien Kellems: “Please Indict Me!”

“All our liberties are due to men who, when their conscience has compelled them, have broken the laws of the land.”

So said William Kingdon Clifford, a 19th-century English mathematician and philosopher. Inspiring words, but did you catch the one glaring error? He forgot the women!

If Clifford had known Vivien Kellems, he wouldn’t have made that mistake.

Born in 1896 in Des Moines, Iowa, Kellems was a locomotive that never quit. Indeed, to continue the train analogy, she was a real-life Dagny Taggart, the railroad vice president protagonist of Atlas Shrugged. Before Kellems died in 1975, she could proudly look back on a life of service to her country as a successful entrepreneur, an accomplished public speaker, a political candidate more interested in educating than in winning, and, most famously, as a tireless opponent of the IRS and its tax code. Outspoken to the end, nobody ever accused her of hiding her light under a bushel.

While earning her bachelor’s degree in economics from the University of Oregon in 1918, Kellems gave her classmates a dose of the spunk that would mark the next half-century of her life. She became the first and only female on the college debate team, humbling many men in a competition widely thought at the time to be for males only. She went on to earn a master’s in economics in 1921. Decades later, while in her 70s, she started work on a PhD at the University of Edinburgh in Scotland. The focus of her dissertation was the issue that made her a virtual household name in America: the income tax.

The Roaring Twenties were well under way when Kellems and her brother Edgar invented the Kellems cable grip, used for lifting and supporting electrical cables. With a thousand dollars she had saved and another thousand borrowed, she founded the Kellems Company in Stonington, Connecticut, in 1927 to manufacture and market the device. By the time World War II broke out, she was a wealthy woman with an intensely loyal following among her hundreds of employees.

When the war demanded grips to lift 2,700-pound artillery shells, Kellems innovated and ended up selling two million of the resulting product to the armed services. Doing business with the military also introduced her to the seamy side of government — the endless and often needless or duplicative paperwork, the meddlesome bureaucracy, the increasingly complicated and dubious tax code, and even a dangerous naiveté about foreign regimes.

Most Americans were reluctant to criticize Washington in the early years of the war. Other more pressing matters occupied us, as the Axis powers scored one victory after another. But when Kellems saw waste, bungling, and stupidity in government, she didn’t hesitate to speak out and make headlines. She was incensed by the US government’s shipping thousands of tons of vital materials to Stalin’s Soviet Union at a time when our own war effort demanded them. To a Chicago audience, she prophetically warned, “Mark my words. This temporary ally will soon pose a mortal threat to the United States and the entire free world.”

Roosevelt’s minions were not amused by Kellems’s very public disapproval. Her private correspondence was intercepted by the Office of Censorship (yes, we had one of those), then leaked to two newspaper columnists and a congressman friendly to the administration. Nothing in her letters was in any way incriminating, and no action was ever taken against her, but it was plain that the government wanted to embarrass and intimidate her into silence. It underestimated Kellems, big time.

As the tax burden soared, so did Kellems’s resentment of the confiscatory marginal rates (as high as 90 percent on personal and corporate income) and the bullying tactics of the “revenuers.” In speeches around the country, she ripped into FDR for promising lower taxes during his first presidential campaign in 1932, only to deliver relentlessly higher rates ever after. Treasury Secretary and FDR crony Henry Morgenthau hinted at treason charges and proceeded toward legal penalties against Kellems. Fortunately, those threats were sidelined by both the war’s end and a scandal that enveloped the Bureau of Internal Revenue (predecessor to the IRS). Thanks in part to Kellems and the women around the country that she personally stirred up, congressional investigations led to the indictment or voluntary retirements of hundreds of BIR employees for violating the very tax laws they were supposed to enforce.

Kellems could get fired up about intrusive government at any level. When the state of Connecticut passed a law in 1947 forbidding women to work after 10:00 p.m., she sprung into action. Her friend, the Hollywood movie star Gloria Swanson, describes what happened:

Charging “rank discrimination,” she brought several hundred women in to work at her factory one night, but no arrests were made. Finally, she got a job in an all-night diner and threatened to work there every night until the legislature acted. Two days later, the law was repealed.

The year 1948 is pivotal in the Kellems timeline. Franklin Roosevelt was three years gone and Harry Truman occupied the Oval Office. What started out as a temporary and “voluntary” wartime measure — tax withholding — was made permanent and compulsory. Kellems would have none of it. She was not about to become an unpaid tax collector for the feds without a fight.

In February 1948, she began paying her employees in full, which meant they had to cough up the required taxes and pay them directly to the federal government. Within days, she was on NBC’s new show Meet the Press — only the second woman to appear as a guest on the program. The withholding law, in her view, was unconstitutional. The very rationale for creating it — to make the costs of big government less visible to workers — was, in her mind, yet another reason to get rid of it. People needed to know what their government was costing them. Violating the law was the only way the issue could be settled once and for all:

If High Tax Harry wants me to get money for him, then he must appoint me an agent for the Internal Revenue Department. He must pay me a salary for my work, he must reimburse me for my expenses incurred in collecting that tax, and I want a badge!

She wrote to the Treasury secretary to inform him of her decision and added, “I respectfully request that you please indict me.”

Fearing an unfavorable ruling in the courts, the government dodged and weaved. The indictment never came. Instead, the IRS sent agents to her bank and seized the $6,100 it said was due.

Kellems fired back with a lawsuit against the government, and in 1951, a jury ordered the feds to return the money, with interest. She continued to press for a decision on constitutionality, and finally, in 1973, the United States Tax Court formally rejected her argument. Meanwhile, she had relented to prevent her company from going bankrupt from IRS seizures. With great reluctance, she began withholding taxes from her employees.

In 1952, she authored a book detailing her fight and the case against the income tax. Titled Toil, Taxes and Trouble, it’s still available. Powerful and entertaining at the same time, it’s full of insights about taxes and the proper role of government. In the words of Romaine D. Huret, author of the excellent 2014 book, Tax Resisters,

Kellems’s book explored the “brainwashing” of taxpayers. The income tax, she wrote, was a way for the government to deliberately “hide” from employees the payment of their taxes and thus to prevent them from becoming “tax-conscious.” Throughout the book, she identified the foes against which she was struggling with a vivid, and at times colloquial, vocabulary: they were the “tax grabbers and tax planners … yellow cowards, mangy little bureaucrats in Washington.”

In the 1960s, with the withholding issue still to be resolved, Kellems took up another tax crusade — the built-in penalty against single people. Income tax rates for an unmarried person were as much as 42 percent higher than those for married couples making the same income. Congress finally recognized her point, and in 1969, it gave her a partial victory by cutting the disparity to a maximum of 20 percent. Swanson wrote,

Vivien could quote passages from the Constitution by heart, recite the legislative history of obscure sections of the Internal Revenue Code, and do it all in a grandmotherly, finger-wagging manner that disarmed even the most experienced politicians.

The Bridgeport Post paid tribute to Kellems in an editorial. Lamentably, there may be no newspaper editor in Connecticut with the guts or the wisdom to print something like this today:

When it comes to possessing a spine of pure steel, we wonder if there is any man or woman in Connecticut who can match Miss Kellems. One lone woman against the whole U.S. government! If there are persons — and we know there are — who think she is simply a pugnacious person making a personal fight over the withholding tax, they are doing her a great injustice. Her interest is one of deep conviction and firm principle based on study of the history of the Constitution of the United States. She understands the circumstances which gave birth to this country, the firm realization of the founders that the power to tax is the power to destroy, and the steps which they took to prevent this power from being misused.

Kellems ran four times for public office in Connecticut, once for governor and three times for US Senate. Though she never won, she did something all too many candidates seldom do: she educated people. After a Kellems campaign, nobody could say she stood for what she thought people would fall for.

She never changed her mind about the income tax. The personal income tax forms that she filed for each of the last 10 years of her life were all blank. Apparently not even the IRS wanted to tangle again with this scrappy patriot.

Whether you agree or disagree with Vivien Kellems on the issues, you have to give her credit. She had principles — sound ones, in my estimation — and the courage to stand for them come hell or high water.

On September 1, 2008, Lawrence W. (Larry) Reed assumed the presidency of the Foundation for Economic Education, headquartered in Irvington, New York. After serving as President of the Mackinac Center… read more